Interim taxes on new construction in PA

[klfrech]

We are about to close on our newly constructed home. We will be subject to interim taxes since right now only the land has been assessed. The interim tax total will then be based on the re-assessed value including both land and home. Of course, we may not see that bill for many months since it will take a while for the re-assessment to occur.

My question is this: is the interim tax amount that is due retroactive to the closing due, when the deed is recorded or perhaps some other date?

We will not have an escrow account since we will be paying all of our property taxes out of pocket.

 

[GingerJay]

I live in NC and work in a law firm that deals primarily in real estate. The way it works in our area is that taxes are assessed Jan 1. If the house is complete Jan 1, that is what you'll pay taxes on. If partially complete, then you'll pay on the improvements as of Jan 1.

I'm sure it varies from state to state; you'll probably get your best answer directly from your county/township tax collector. Good luck!

 

[Arkansan]

I think I can help. Short answer is it depends on your township and how quickly they reassess your new home.

Our experience:

We purchased our new construction home in PA and closed early Oct. 2012. We received a knock on the door from the Township within a couple of weeks. She did not ask to come inside, but I would not have let her inside (I don't believe you are required to let them in.). She asked a couple of questions about the home (if we had any cathedral ceilings, if the 2nd floor went into the garage, etc.) and then asked if she could take a look outside the home and take measurements (to find square footage). I agreed. I figured I wanted an accurate assessment, not a guess of square footage. (I figured they would guess bigger not smaller.)

About a month later we received a letter with our new assessment. Within a few days we got our tax bill. Our Township is on a calendar year, school district is a fiscal year--July through June. The interim bill was for 2 months (Nov. and Dec.) of Twp. Taxes and 8 months of school taxes (Nov.-June). It was due in Jan. or Feb. 2013.

We then got our regular Township tax bill a few months later which was due in June 2013. AND our school tax bill which is due in Sept. 2013. We will have paid a LOT of money in property taxes this year so have a lot to deduct! (Only silver lining I can think of!).

We don't escrow our taxes either. I estimated how much $$ to transfer to a special savings account monthly based on the initial assessment, but since we now have a year of "real" tax bills, I have recently adjusted this amount so we don't fall short. The good part of the staggered payment schedule is the account can build back up again before the next bill is due.

Enjoy your new home! I hope I helped. That first year is really a doozy!!! PA is the only place we've lived that does these interim bills. The (4) other places we've lived and had new construction we just received a bill that said our new assessment and what the tax rate would be for the NEXT tax year. Gotta love PA! . We do like it here, though! To a certain extent, you get what you pay for!

 

[klfrech]

Thank you for your great reply! We are in the exact same situation.

We've never escrowed our taxes, so we're fairly disciplined in saving the money. I too, put it in a "special account". I'll just have to adjust it because our taxes will be higher in our new home.

Building a new house is a big expense; I just want to make sure that we don't overspend and squander away the money I've earmarked for the "interim taxes".

Thanks again!

 

[Iamthequeen]

It really depends in which county your new home is. You can contact the County tax assessment office to see what the policy is. In my county, only the county does tax assessments, not the townships or boroughs.

 

[klfrech]

We live outside of Pittsburgh, PA. In this area, only the county does the assessments. They pass that information onto the township and the school districts.

 

[Arkansan]

It could be the county here, too. That would account for the lag time between the Assessor coming to the home and receiving the assessment numbers and then the interim bill. We had just moved to PA from out of state. Sorry for any confusion.